Removal of names of companies from the registrar of companies

Removal of names of companies from the registrar of companies:

Power of registrar to remove name of the a company from registrar of companies:


Where the registrar has reasonable cause to believe that-

  • A company has failed to commence its business within one year of its incorporation.
  • The memorandum subscribers who haven’t paid the subscription which they had undertaken to pay within a time period of 180 days from the incorporation date of a company and a declaration under the sub-section (1) of section 11 to this effect hasn’t been filed within hundred and eighty days of its incorporation, or
  • A company which is not carrying on any operation or business for a period of preceding financial years and hasn’t made any application in that duration of period in order to obtain the status of a dormant company under the section 455.



He would send the notice to the company and all the directors of the company about his intention to remove the name of the company from the register of companies  and request them to send their representations along with the relevant document copies, if any, within a period of thirty days from the date of the notice.

Without prejudice to the provisions of sub-section(1), a company may extinguish all of its liabilities by a special resolution or consent or 75% members in terms of paid-up share capital, file the application in the prescribed manner to the registrar in order to remove the name of the company from the registrar of companies on all or any of the grounds which has been specified in sub-section(1) and the registrar shall, on receipt of such application, a public notice to be issued in the prescribed manner:


In case of a company which is regulated under a special act, the approval from the regulatory body established or constituted under this act shall also be obtained and enclosed with the application.

Things which are mentioned in sub-section(2) would not be applicable for the company which is registered under section 8.

A notice which has been issued under sub-section (1) or (2) can be published in the prescribed manner and also in the official gazette for the information of a general public.

As the expiry time mentioned in the notice, the registrar may unless cause to the contrary is shown by the company, strike off its name from the register of companies. It shall publish the notice thereof in the official gazette and the publication in the official gazette of this notice, the company may get dissolved.




Before passing an order by the registrar under sub-section( 5) may satisfy himself that the sufficient provisions has been made for the realization of all the amounts due to the company and for the discharge or the payment of its obligations and liabilities by the company within the reasonable time period.

If required, obtain the necessary undertakings from the director or managing director or a persons in change of the management of the company.


Further, notwithstanding the undertakings which are referred in this sub-section, the assets of the company will be made available for the discharge or payment of all its obligations or liabilities even after the date of the order for removing the name of the company from the register of companies.

The liability if any of every manager or director or other officer who was exercising any power of management and of every member of the company dissolved under the sub-section(5) shall continue and may be enforced as if the company had not been dissolved.

The power of the tribunal in order to wind up a company will not be affected by this section


Restrictions on making application under section 248 in certain situations:

An application which is under sub-section (2) and 248 on behalf of a company will not be made if, at any time in the previous three months of a company,

  • Has shifted its registered office from one state to another or changed its name;
  • Has made a disposal or the value of property or rights held by it, immediately before the cesser of trade or otherwise carrying on a business for the purpose of disposal for gain in the normal course of trading or otherwise carrying on a business;
  • Has engaged in any other activities except the one which is necessary or expedient for the purpose of making the application under this section or deciding whether to do so or concluding the affairs of the company or complying with any statutory requirement;
  • Has made an application to the tribunal in order to sanction of a compromise or arrangement and the matter has not been finally concluded; or

If a company files an application under the sub-section (2) of section 248 in violation of sub-section(1), it would be punishable with  a fine which may extends up to one lakh rupees.

The application which had been filed under the sub-section (2) of section 248 shall be withdrawn by the company or rejected by the registrar as soon as the conditions under sub-section (1) are brought to his notice.

Effect of company notified as dissolved:

The company which dissolves under the section 248, it shall on and from the date mentioned in the notice under sub-section(5) of that section cease to operate as a company and the certificate of incorporation may be issued to it shall be deemed to be cancelled from such date except for the purpose of realizing the amount due to the company discharge or payment of the liabilities or obligations of the company.

Fraudulent application for removal of name:


If it is found that an application by a company under sub-section(2) of section 248 has been made with the object of evading the liabilities of the company or with the intention to deceive the creditors or to defraud any other persons, the persons who are in charge of the management of the company will, notwithstanding that the company has been notified as dissolved:-

  • Be jointly and severally liable to any person who had incurred loss or damage as a result of the company being notified as dissolved; and
  • Be punishable for fraud in the manner as provided in section 447.

Without prejudice to the provisions contained in the sub-section(1), the registrar may also recommend prosecution of the persons responsible for the filing of an application under sub-section(2) of section 248.


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